Vertical Product Differentiation, Entry-Deterrence Strategies, and Entry Qualities, September 2005

We analyze the entry of a new product into a vertically differentiated market in which an entrant and an incumbent compete in prices. Here the entry-deterrence strategies of the incumbent firm rely on “limit qualities.” With a sequential choice of quality, a quality-dependent marginal production cost, and a fixed entry cost, we relate the entry-quality decision and the entry-deterrence strategies to the level of entry cost and the degree of consumer heterogeneity. Quality-dependent marginal production costs in the model entail the possibility of inferior-quality entry as well as an incumbent’s aggressive entry-deterrence strategies of increasing its quality level toward potential entry. Welfare evaluation confirms that social welfare is not necessarily improved when entry is encouraged rather than deterred.

Managing Quality under Heterogeneous Consumer Demand and Product Quality, October 2005

Based on accepted advances in the marketing, economics, consumer behavior, and satisfaction literatures, we develop a micro-foundations model of a firm that needs to manage the quality of a product that is inherently heterogeneous in the presence of varying customer tastes or expectations for quality. Our model blends elements of the returns to quality, customer lifetime value, and service profit chain approaches to marketing. The model is then used to explain several empirical results pertaining to the marketing literature by explicitly articulating the trade-offs between customer satisfaction and costs (including opportunity costs) of quality. In this environment firms will find it optimal to allow some customers to go unsatisfied. We show that the relationship between the expected number of repeated purchases by an individual customer is endogenous to the choice of quality by the firm, indicating that the number of purchases cannot be chosen freely to estimate a customer’s lifetime value.

Discounting Spotted Apples: Investigating Consumers’ Willingness to Accept Cosmetic Damage in an Organic Product, November 2006

Organic producers have limited methods of avoiding plant diseases that result in cosmetic damage to produce. Therefore, the appearance of organic produce is often less than perfect. We use an experimental auction to investigate how cosmetic damage affects consumers’ willingness to pay for organic apples. We find that 75% of the participants are willing to pay more for organic than for conventional apples given identical appearance. However, at the first sight of any imperfection in the appearance of the organic apples, this segment is significantly reduced. Furthermore, we find that there is a significant effect of interaction between cosmetic damage and product methods. Even though most consumers say they buy organic products to avoid pesticides, we find that cosmetic damage has a larger impact on the willingness to pay for organic apples than for conventional apples.

Improving Transition Outcomes: MyTransitionIowa.org Resource Mapping Product

Information about Improving Transition Outcomes statewide resource mapping product.

Safer Construction and Maintenance Safer Construction and Maintenance Practices to Minimize Potential Liability by Counties from Accidents, September 1979

Tort claims resulting from alleged highway defects have introduced an additional element in the planning, design, construction, and maintenance of highways. A survey of county governments in Iowa was undertaken in order to quantify the magnitude and determine the nature of this problem. This survey included the use of mailed questionnaires and personal interviews with County Engineers. Highway-related claims filed against counties in Iowa amounted to about $52,000,000 during the period 1973 through 1978. Over $30,000,000 in claims was pending at the end of 1978. Settlements of judgments were made at a cost of 12.2% of the amount claimed for those claims that had been disposed of, not including costs for handling claims, attorney fees, or court costs. There was no clear time trend in the amount of claims for the six-year period surveyed, although the amount claimed in 1978 was about double the average for the preceding five years. Problems that resulted in claims for damages from counties have generally related to alleged omissions in the use of traffic control devices or defects, often temporary, resulting from alleged inadequacies in highway maintenance. The absence of stop signs or warning signs often has been the central issue in a highway-related tort claim. Maintenance problems most frequently alleged have included inadequate shoulders, surface roughness, ice o? snow conditions, and loose gravel. The variation in the occurrence of tort claims among 85 counties in Iowa could not be related to any of the explanatory variables that were tested. Claims appeared to have occurred randomly. However, using data from a sub sample of 11 counties, a significant relationship was shown probably to exist between the amount of tort claims and the extensiveness of use of warning signs on the respective county road systems. Although there was no indication in any county that their use of warning signs did not conform with provisions of the Manual on Uniform Traffic Control Devices (Federal Highway Administration, Government Printing Office, Washington, D.C., 1978), many more warning signs were used in some counties than would be required to satisfy this minimum requirement. Sign vandalism reportedly is a problem in all counties. The threat of vandalism and the added costs incurred thereby have tended to inhibit more extensive use of traffic control devices. It also should be noted that there is no indication from this research of a correlation between the intensiveness of sign usage and highway safety. All highway maintenance activities introduce some extraordinary hazard for motorists. Generally effective methodologies have evolved for use on county road systems for routine maintenance activities, procedures that tend to reduce the hazard to practical and reasonably acceptable levels. Blading of loose-surfaced roads is an example of such a routine maintenance activity. Alternative patterns for blading that were investigated as part of this research offered no improvements in safety when compared with the method in current use and introduced a significant additional cost that was unacceptable, given the existing limitations in resources available for county roads.

Liability and Traffic Control Considerations for Low Water Stream Crossings, HR-218, 1981

The current shortage of highway funds precludes the immediate replacement of most of the bridges that have been evaluated as structurally deficient or functionally obsolete or both. A low water stream crossing (LWSC) affords an economical alternative to the replacement of a bridge with another bridge in many instances. However, the potential liability that might be incurred from the use of LWSCs has served as a deterrent to their use. Nor have guidelines for traffic control devices been developed for specific application to LWSCs. This research addressed the problems of liability and traffic control associated with the use of LWSCs. Input to the findings from this research was provided by several persons contacted by telephone plus 189 persons who responded to a questionnaire concerning their experience with LWSCs. It was concluded from this research that a significant potential for accidents and liability claims could result from the use of LWSCs. However, it was also concluded that this liability could be reduced to within acceptable limits if adequate warning of the presence of an LWSC were afforded to road users. The potential for accidents and liability could further be reduced if vehicular passage over an LWSC were precluded during periods when the road was flooded. Under these conditions, it is believed, the potential for liability from the use of an LWSC on an unpaved, rural road would be even less than that resulting from the continuing use of an inadequate bridge. The signs recommended for use in advance of an LWSC include two warning signs and one regulatory sign with legends as follows: FLOOD AREA AHEAD, IMPASSABLE DURING HIGH WATER, DO NOT ENTER WHEN FLOODED. Use of the regulatory sign would require an appropriate resolution by the Board of Supervisors having responsibility for a county road. Other recommendations include the optional use of either a supple mental distance advisory plate or an advisory speed plate, or both, under circumstances where these may be needed. It was also recommended HR-218 Liability & Traffic Control Considerations for Low Water Stream Crossings that LWSCs be used only on unpaved roads and that they not be used in locations where flooding of an LWSC would deprive dwelling places of emergency ground access.

Construction and Maintenance Practices to Minimize the Potential Liability of Counties for Roads in Rural Subdivisions, HR-221, 1981

In an earlier research project, HR-204, the magnitude and nature of highway related tort claims against counties in Iowa were investigated. However, virtually all of the claims identified in that research resulted from incidents that occurred in areas with predominantly agricultural land use. With recent increases in the rural non-farm population, many traditionally urban problems are also appearing in built-up areas under county jurisdiction. This trend is expected to continue so that counties must anticipate a change in the nature of the tort claims they will encounter. Problems that heretofore have been unique to cities may become commonplace in areas for which counties are responsible. The research reported here has been directed toward an investigation of those problems in rural subdivisions that lead to claims growing out of the provision of highway services by counties. Lacking a sufficient database among counties for the types of tort claims of interest in this research, a survey was sent to 259 cities in Iowa in order to identify highway related problems leading to those claims. The survey covered claims during a five year period from 1975 to 1980. Over one-third of the claims reported were based on alleged street defects. Another 34 percent of the claims contained allegations of damages due to backup of sanitary sewers or defects in sidewalks. By expanding the sample from the 164 cities that responded to the survey, it was estimated that a total of $49,000,000 in claims had been submitted to all 259 cities. Over 34% of this amount resulted from alleged defects in the use of traffic signs, signals, and markings. Another 42% arose from claims of defects in streets and sidewalks. Payments in settlement of claims were about 13.4% of the amount asked for those claims closed during the period covered by the survey. About $9,000,000 in claims was pending on June 30, 1980 according to the information furnished. Officials from 23 cities were interviewed to provide information on measures to overcome the problems leading to tort claims. On the basis of this information, actions have been proposed that can be undertaken by counties to reduce the potential for highway-related claims resulting from their responsibilities in rural subdivisions and unincorporated communities. Suggested actions include the eight recommendations contained in the final report for the previous research under HR-204. In addition, six recommendations resulted from this research, as follows: 1. Counties should adopt county subdivision ordinances. 2. A reasonable policy concerning sidewalks should be adopted. 3. Counties should establish and implement a system for setting road maintenance priorities. 4. Counties should establish and implement a procedure for controlling construction or maintenance activities within the highway right of way. 5. Counties should establish and implement a system to record complaints that are received relating to highway maintenance and to assure timely correction of defective conditions leading to such complaints. 6. Counties should establish and implement a procedure to ensure timely advice of highway defects for which notice is not otherwise received.

Asphalt Cement Concrete Longitudinal Joint Adhesive Crafco PN 34524 (Iowa DOT New Product C-98-7), HR-2084, 2000

The joint between two lanes of asphalt pavement is often the first area of a roadway which shows signs of deterioration and requires maintenance. As the final lift of hot asphalt is being placed in a construction project, it is being forced p against the adjoining lane of cold asphalt, forming the longitudinal joint. The mating of the two lanes, to form a high quality seal, is often not fully successful and later results in premature stripping or raveling as water enters the unsealed joint. The application of a hot poured rubberized asphaltic joint sealant along the joint face in the final stage of construction should help to form a watertight joint seal. A new product, especially formulated for the longitudinal joint in asphalt pavements was proposed to improve joint sealing. The following describes the experimental application of the new product, Crafco, PN 34524.

Development of an Improved Agricultural-Based Deicing Product, TR-581, 2010

Snow and ice removal on public streets is a critical part of the work of departments of transportation in northern U.S. states, including Iowa. Iowa is also a state rich in agricultural resources, some of which undergo industrial processes that generate a number of byproducts, e.g., in converting corn to ethanol or soy to biodiesel. It would be desirable to find those that, with a minimum of additional processing, can be used as a deicing compound, either alone or in combination with products currently in use. The focus of this work is therefore to investigate by-products from agricultural processes that may be suitable for use as deicing applications. This topic has been investigated in the past by others, with many patented products described in the literature. An initial screening was carried out to assess the potential acceptability of selected commercial products, as well as a glycerol developed for this project. Based on the variety of parameters tested, the product combination that shows the greatest promise for future application consists of 80% glycerol with 20% NaCl.

Time-Temperature Strength-Reaction Product Relationships in Lime-Bentonite-Water Mixtures, HR-111, 1965

The interrelation of curing time, curing temperature, strength, and reactions in lime-bentonite-water mixtures was examined. Samples were molded at constant density and moisture content and then cured for periods of from 1 to 56 days at constant temperatures that ranged from 5C to 60C. After the appropriate curing time the samples were tested for unconfined compressive strength. The broken samples were then analyzed by x-ray diffractometer and spectrophotometer to determine the identity of the reaction products present after each curing period. It was found that the strength gain of lime-clay mixtures cured at different temperatures is due to different phases of the complex reaction, lime & clay to CSH(gel) to CSH(II) to CSH(I) to tobermorite. The farther the reaction proceeds, the higher the strength. There was also evidence of lattice substitutions in the structure of the calcium silicate hydrates at curing temperatures of 50C and higher. No consistent relationship between time, temperature, strength, and the S/A ration of reaction products existed, but in order to achieve high strengths the apparent C/S ration had to be less than two. The curing temperature had an effect on the strength developed by a given amount of reacted silica in the cured lime-clay mixture, but at a given curing temperature the cured sample that had the largest amount of reacted silica gave the highest strength. Evidence was found to indicate that during the clay reaction some calcium is indeed adsorbed onto the clay structure rather than entering into a pozzolanic reaction. Finally, it was determined that it is possible to determine the amount of silica and alumina in lime-clay reaction products by spectrophotometric analysis with sufficient accuracy for comparison purposes. The spectrophotometric analysis techniques used during the investigation were simple and were not time consuming.

Training Aids to Reduce Potential County Liability, HR-289, Draft, 1987

Iowans who travel secondary roads regard these roads as a very important part of their lives. These highways provide a means of transporting products to market and children to school. They are also links to nearby cities and towns. Nearly 3.8 billion vehicle miles of travel occur each year on Iowa's nearly 90,000 mile secondary road system. Accidents do happen. However, improvements in highways, in vehicles, in driver education, in legislation, and in enforcement have combined to make driving in Iowa very safe. If our highways are to remain safe, these efforts need to be continued. This presentation was developed to help county highway department personnel in their effort to maintain and improve highway safety. The presentation is not a standard, specification or regulation.

Biofuel Co-Product Uses for Pavement Geo-Materials Stabilization, TR-582, 2010

The production and use of biofuels has increased in the present context of sustainable development. Biofuel production from plant biomass produces not only biofuel or ethanol but also co-products containing lignin, modified lignin, and lignin derivatives. This research investigated the utilization of lignin-containing biofuel co-products (BCPs) in pavement soil stabilization as a new application area. Laboratory tests were conducted to evaluate the performance and the moisture susceptibility of two types of BCP-treated soil samples compared to the performance of untreated and traditional stabilizer-treated (fly ash) soil samples. The two types of BCPs investigated were (1) a liquid type with higher lignin content (co-product A) and (b) a powder type with lower lignin content (co-product B). Various additive combinations (co-product A and fly ash, co-products A and B, etc.) were also evaluated as alternatives to stand-alone co-products. Test results indicate that BCPs are effective in stabilizing the Iowa Class 10 soil classified as CL or A-6(8) and have excellent resistance to moisture degradation. Strengths and moisture resistance in comparison to traditional additives (fly ash) could be obtained through the use of combined additives (co-product A + fly ash; co-product A + co-product B). Utilizing BCPs as a soil stabilizer appears to be one of the many viable answers to the profitability of the bio-based products and the bioenergy business. Future research is needed to evaluate the freeze-thaw durability and for resilient modulus characterization of BCP-modified layers for a variety of pavement subgrade and base soil types. In addition, the long-term performance of these BCPs should be evaluated under actual field conditions and traffic loadings. Innovative uses of BCP in pavement-related applications could not only provide additional revenue streams to improve the economics of biorefineries, but could also serve to establish green road infrastructures.

Report on the Iowa Judicial Retirement System as of June 30, 2015 and the net pension liability as of June 30, 2014

Report on the Iowa Judicial Retirement System as of June 30, 2015 and the net pension liability as of June 30, 2014